What is a Program-Related Investment?
A program-related investment – commonly called a PRI – is a tool used by foundations to leverage their philanthropic dollars. Unlike grants, PRIs provide foundations a return on their investment, through either repayment or return on equity. PRIs give charitable organizations or commercial ventures access to needed capital, typically at favorable terms. Note: PRIs are available solely for foundation purposes and are not available to individual investors.
Funder benefits include:
How do PRIs work?
PRIs fund capital projects, provide bridge loans, or offer liquidity to loan funds, among other things. PRIs employ financing methods such as loans (senior and subordinated), loan guarantees, lines of credit, linked deposits, or equity investments. Often, PRIs are made to share risk and leverage co-investment, and often attract traditional financial players to the table. Some program areas funded by PRIs include:
Because PRIs are paid back, the funds are recycled into the next charitable purpose. PRIs are increasingly used to help funders have greater and more sustainable impact within their philanthropic agendas.
How do I get started?
To get started with PRIs, you will first want to take a close look at your foundation’s mission, goals and size. The questions below will help you get started on identifying what is most important to you in a PRI program.
Calvert Foundation Makes PRIs Easy
Calvert Foundation makes PRIs easy for small foundations. We offer two main opportunities for PRI makers. The first is one we call “PRI in a Box,” which is one of the most convenient ways to get started. This allows foundations to simply invest in Calvert Foundation’s Community Investment Note™, a high-impact investment product consistent with PRI guidelines that generates economic opportunities in underserved communities and markets. These professionally managed investments finance a portfolio of over 250 nonprofit organizations focused on affordable housing, microfinance, small business lending, community facilities, fair trade, social enterprise, and more.
The second option, “PRI Outside the Box,” is appropriate for foundations that wish to design and operate their own customized PRI programs. This option employs Calvert Foundation’s Community Investment Partners (CIP) program, which provides information, analysis, and advice, and delivers professional management and servicing of community financial assets. CIP can help you:
Contact us to learn more! Call 800.248.0337 and ask for Justin Conway.